GRAIN & PRICES WEEKLY REPORT

The upcoming USDA Grain Stocks and Planting Intentions reports, will out on March 31.??

Generally, the end of quarter reports from NASS tend to be accompanied by big price swings (though there are exceptions).?

Thus, operators questioned all along the week, about if staying or cashing out at so highest prices.

USDA will let us know on Thursday.

Meanwhile, on US farm markets, corn prices rose 1.66% this week, another $0.123 per bushel.

Soybeans jumped $0.422 per bushel this week, or 2.53%.?

Soybean meal gained 2.28% for the week

Soybean oil was repaid for by a 3.4% weekly rise.

Wheat recovered more than they lost the previous week in 2 out of 3 markets.?

Chicago indeed, was up 3.62% for the week, but is still 5 cents shy of where it closed 2 weeks ago.??

KC HRW was up 3.76% for the week, and had a two week gain of 22 cents.??

MPLS was up 22 cents for the week, almost exclusively on Friday, and up 13 cents for the two week period.?

For the week was up 2.12%.

Going inside the numbers, CBOT corn futures close at $7.54/bu.?

CBOT soybean futures finished the week at $17.10/bu.

Soymeal jumped by $10,9/smt for the week at $487.90 smt.

Soy oil gained by $2.46 cents, to close at $74.75.

May CBOT soft red winter (SRW) futures were up $0.385 to close at $11.02/bu.?

May KCBT hard red winter (HRW) futures bounced $0.403 ending at $11.11/bu.

May MGE hard red spring (HRS) futures rose $0.225 to close at $10.83/bu.

Meantime, as of March 24, 2022, US corn 3YC (Gulf) was at $361/mt (down $11/mt from last week).

US soybean 2Y (Gulf) quoted at $684/mt (up $5/mt from last week).

USDA’s National Ethanol report showed corn oil prices were slightly down this week as renged between 79.40 NB and 81.50 IO cents/lb.?

That compares to 80.25 and 82 cents seen regionally last week.

DDGS FOB prices were also higher, with NOLA quotes from $370 LW to $400 and PNW $8 higher to $370/ton.?

Past week DDGS FOB export quotes were $355 - $382/ton in NOLA and $362 in the PNW.?

Ethanol cash prices were between $2.31 MI_NB to $2.50/gal EC-WC.?

Stronger compared to prior week when ranged between $2.30 KC to $2.46/gal EC.

Meanwhile gasoline futures ended the week at $3.3780, that was up from $3.1759/gal posted last week.

USDA’s weekly biofuels report showed B100 prices averaged $6.57/gal, unchanged from past week.?

USDA’s weekly Crush report showed the estimated processing value of soybeans was $20.71/bu on $17.10 cash beans.?

That compared to $20.07/bu reported prior week on $16.65 beans.

As for wheat, US wheat No 2 Hard Red Winter (HRW) was valued at $485/mt (up $5/mt from last week).

US wheat No 2 Soft Red Winter (SRW) was at $452/mt (down $5/mt from last week).

Northern Durum continue to be offered from the Great Lakes for April/May 2022 at at $595/MT ($16.19/bu) (unchanged from prior week).

In this context, corn basis bids were mostly steady to firm on Friday after rising 3 to 6 cents higher at four Midwestern locations.?

An Ohio river terminal bucked the overall trend after sliding 6 cents lower.

Soybean basis bids were mostly steady across the central U.S. but did tilt 3 cents higher at an Ohio elevator.

As for wheat, basis this week was down in both the Gulf and Pacific Northwest (PNW).?

However, logistical challenges continue to support a basis that is firmer than it would be otherwise.?

Inconsistent rail performance since January makes nearby basis hard to define, some traders say.?

Higher ocean freight rates have added to the constraints.?

Some commodities typically exported from the Gulf have instead been routed through the PNW for shorter ocean routes.

In energy markets, crude prices rose more than 1% to over $120 a barrel on Friday.

Oil prices had slipped earlier in the session as exports from Kazakhstan's CPC crude terminal partially had resumed and the EU held off on imposing an embargo on Russian energy as members remained split on the issue.

However, a missile attack by Yemen's Houthis, targeted an Aramco's fuel distribution station in Jeddah in Saudi Arabia on Friday, rising concerns on oil supply disruption, as Saudi Arabia said it will not hold responsibility for any shortage of oil supplies in global markets caused by Houthi attacks.

The attack, comes just five days after the Houthi group fired missiles and drones at Saudi energy and water desalination facilities, causing a temporary drop in output at a refinery.

Thus, Brent crude settled up $1.62, or 1.4%, to $120.65 a barrel and U.S. West Texas Intermediate (WTI) crude ended $1.56, or 1.4% higher, at $113.90.?

Both had dropped $3 earlier.

Both benchmarks notched their first weekly gains in three weeks - Brent rose more than 11.5% and WTI gained 8.8%

With global stockpiles at their lowest since 2014, analysts have said the market remaine vulnerable to any supply shock.

Consequentially, the Biden administration is considering another release of oil from the Strategic Petroleum Reserve that, if carried out, could be bigger than the sale of 30 million barrels earlier this month, a source said.

Meantime, the U.S. oil rig count, an early indicator of future output, rose seven to 531 this week, its highest since April 2020, thougth the increases have been small and slowed down recently because many companies focus on returning money to investors rather than boosting output and are facing supply constraints.

In the freight market, the Baltic Exchange Dry Index went down 0.9% to 2,544 on Friday, extending losses for the second day in a row.?

The capesize index, which tracks iron ore and coal cargos of 150,000-tonnes slumped 4.2% to 1,887; and the supramax index shed 13 points to 3,020.?

Meanwhile, the panamax index which tracks cargoes of about 60,000 to 70,000 tonnes of coal and grains, advanced 1%, to 3,413.?

For the week, the Baltic Dry Index declined about 2.3%, the second consecutive weekly fall on a pullback in the larger capesize vessel segment.

On week 12, accelerated growth of freight rates continues in the Azov and Black Sea region.?

This week, indeed, the rate for a of 3k parcel of wheat from Azov to Marmara Sea ports reaches $62 per ton, an increase of $9 compared to last week’s rates, Sea Lines shipbrokers report.

This trend can be explained by unfavorable weather conditions in the Black and Azov Seas at the end of the previous week, which led to a shortage of spot tonnage.?

In addition, there is a huge demand for grain crops and coal in the market, which contributes to the agiotage for vessels in the region.

According to Sea Lines, shipowners agree more often to work from the northern ports of the Sea of Azov, although for some owners cargoes from Temryuk and Kavkaz still remain a priority.?

As for destinations, same as last week, charterers consider cargoes to a variety of destinations, such as Turkey, Israel, Italy or Egypt.

According to Sea Lines, on week 12, freight rates for wheat parcels from Azov made $60 to the Black Sea, $62 to Marmara, $75 to Mersin and $77 to Egypt.

Freight rates from Rostov AB (after bridge) are $1 above, from Rostov BB (before bridge) the same, from Yeisk and Taganrog $1 below, and from Temryuk $3 below those from the port of Azov.

In the Caspian, freight rates from some ports of origin went down.

On week 12, freight rates for shipping corn by 3,000 dwt bulkers to Iran make $21 from Aktau, $25 from Makhachkala, and $30 from Astrakhan.

In equity markets, the S&P 500 ended higher on Friday as financial shares rose after the benchmark Treasury yield jumped to its highest level in nearly three years.

Ten-year Treasury yields, indeed, were last at 2.492% after earlier rising above 2.50% for the first time since May 2019.

The Nasdaq ended lower, and tech and other big growth names mostly declined, but they finished off session lows following a late-session rally.

Investors are assessing how aggressive the Federal Reserve will be as it tightens monetary policy .

Thus, on Wall Street, the Dow Jones Industrial Average rose 153.3 points, or 0.44%, to 34,861.24, the S&P 500 gained 22.9 points, or 0.51%, to 4,543.06 and the Nasdaq Composite dropped 22.54 points, or 0.16%, to 14,169.30.

Friday’s U.S. economic data was bearish for stocks after U.S. Feb pending home sales unexpectedly fell -4.1% m/m, weaker than expectations of a +1.0% m/m increase.??

Also, the University of Michigan’s final-March U.S. consumer sentiment index was revised downward by -0.3 to a 10-1/2 year low of 59.4.

However, for the week, the Nasdaq and S&P 500 registered solid gains of 2% and 1.8%, respectively, and the Dow was nominally higher with a 0.3% rise.

MSCI's gauge of stocks across the globe was up 0.11%, adding a second consecutive week of gains for the first time in 2022.?

The pan-European STOXX 600 index also inched up 0.11%, but was down on the week.

In currency markets, the U.S. dollar index was substantially unchanged on Friday, up only 0.02%.

However, for the week, the dollar index bounced 0.6% to close at 98.822.

The euro fell 0.07% to $ 1.0983 on Friday, and was under pressure after the German Mar IFO business climate fell -7.7 to a 20-month low of 90.8, weaker than expectations of 94.2.?

The yen gave up a 0.16% on Friday to close at 122.06 vs. US dollar, after BOJ Governor Kuroda said that a weaker yen is a plus for the Japanese economy, but the decline in the yen can cut disposable household incomes.

On the weather side, widespread rain benefitted most U.S. winter wheat growing areas this week except for much of Texas.?

In the Southern and Central Plains, heavy rain fell across central and eastern Oklahoma and northern Texas supporting drought improvements to those areas.?

Central and eastern Kansas, southeastern Nebraska and eastern Colorado also saw improvements after receiving significant rainfall.?

In the Dakotas, a lack of seasonal snow cover, higher than average temperatures, and high winds have expanded extreme and severe drought categories.?

In the west, northern Idaho, western Montana, and northern Oregon saw some improvement but longer-term drought remains entrenched across the region.

For the coming days, between today and Monday, the Plains should stay completely dry while parts of the eastern Corn Belt could gather a little more moisture, per the latest 72-hour cumulative precipitation map from NOAA.?

The agency’s 8-to-14-day outlook predicts a return to drier-than-normal conditions in parts of the upper Midwest and Northern Plains, with seasonally cool weather likely for most of the U.S. between April 1 and April 7.

The latest updates to the U.S. Drought Monitor indicate that 71.9% of the country is experiencing some level of drought, down from a seasonal peak of 75.1% earlier this month. In the Northern Plains, 86.7% of the region is affected, while in the Midwest, 40.9% is affected.

Meantime, the National Agriculture Statistics Service (NASS) updated its Field Crops Reports this week.?

In Kanas, topsoil moisture was rated 31% very short, 8 points better than last week, and 33% adequate.?

In Oklahoma, topsoil moisture is 39% adequate, 32% short, and 28% very short.?

In Texas, soil moisture is 89% very sort.?

In Colorado, topsoil moisture is 53% adequate or surplus and 47% short or very short.

Seventy-three percent of the US winter wheat crop is under drought conditions.?

Over half of the wheat crop in Kansas is under extreme drought.

The crop rating increased slightly to 25% Gd/Ex.?

In Texas, winter wheat was 18% headed.?

NASS reported Oklaoma conditions as 21% good/ex.?

Meantime, state planting data from Texas had 42% of corn planted as of 3/20.?

That is 5 ppts ahead of last year and 7% points more than the 5-yr average.?

Milo was 30% planted, which is 1ppt ahead of their 5-yr average.?

On the demand side, the weekly Export Sales report showed a sharp decline in corn sales, lowing 47% to 979,500 MT.?

New crop sales totaled just 6,100 MT as price rationing discouraged buyers from extending coverage.?

US old crop corn export commitments (shipped plus outstanding sales) are now at 53.018 MMT, now 18% below last year at this time.?

They are 83% of the full year WASDE forecast, dropping behind the average pace of 84%.?

Accumulated exports are 48% of the updated WASDE full year projection.?

For sorghum, USDA reported 6,439 MT of net old crop cancelations and no new crop business.?

Sorghum exports were 255,178 MT during the week that ended 3/17.?

As for soybean, sales dropped 67% week over week to only 412,200 MT.??

Soybean bookings for the new crop slot were net negative 13,000 MT due to Chinese changes.?

US soybean exporters have either sold or shipped 54.036 MMT of the 21/22 crop, now 11% smaller than last year’s record buying pace.?

However, total export commitments are 95% of the USDA full year estimate, outpacing the 91% average for this date.?

Shipments are 75% of that projection, even with the average pace.?

For the products, USDA reported soybean oil bookings were a net cancelation of 1,986 MT with no 22/23 sales reported.?

For meal, 302,865 MT were sold according to USDA’s weekly data.?

That was split 260.7k MT for 21/22 delivery and 42.2k MT for 22/23.?

As for wheat?sales were 155,700 MT for the week ending 3/17.?

New crop sales were better than the previous week, at 367,300 MT.?

Old crop export commitments are now 19.159 MMT, or 88% of USDA’s full year forecast, still lagging the average pace by 11%.?

Shipments to date are still 22% smaller than a year ago, at 15.341 MMT.?

That is 70% of the USDA projection vs the average of 76% by now.?

Meantime, the weekly Commitment of Traders report showed managed money spec funds were net long 384,101 contracts in corn as of 3/22.?

That was up 11,192 contracts week/week as they continue to anticipate bullish supply/demand developments and inflationary pressures.

Commercial hedgers added 12.8k new longs against 2k new shorts for a 737,088 contract net short.?

CFTC’s weekly Commitment of Traders report indicated spec traders in soybean futures and options added 3,502 contracts to their net long in a week.?

That took the net position to long 174,192 contracts.??

The record large fund long is 253,889 contracts, set in 2012.

Commercial bean traders were 2,769 contracts more net short through the week, to 298,311 contracts.?

For the product, CFTC reported managed money firms as 101,164 contracts net long in soymeal as of 3/22.?

That was a 1,995 contract lighter net long.?

Spec funds were 84,078 contracts net long in soy oil, a 5,093 contract reduction wk/wk.?

As for wheat, Friday’s CFTC Commitment of Traders report showed spec funds in CBT wheat futures and options net long 19,511 contracts as of March 22, down 3,434 contracts from the previous week.?

For KC wheat, they added 1,553 longs to their net long position in the week ending Tuesday, taking it to 45,789 contracts.

CFTC reported managed money as 14,222 contracts net long in Minneapolis wheat.?

That was a 165 contract lighter position wk/wk on reduced OI.?

From Canada, Canada’s drought monitor showed that much of the Canadian Prairies were still parched with southern Alberta and central Saskatchewan in extreme drought as of February 28.?

An agroclimate specialist at Agriculture and Agri-Food Canada said soil moisture is depleted from last year and is “extremely vulnerable to dry periods this year.”?

One analyst said spring wheat plantings are expected to increase 2% this year and noted that farmers will consider crops that do well in dry conditions.?

The USDA reported that in 2020 Canada accounted for 13% of the global wheat trade.

Meantime, workers on the Canadian Pacific Railway (CP) this week participated in a two-day work stoppage before the Teamsters Canada Rail Conference (TCRC) and CP agreed to binding arbitration on Tuesday.?

Wade Sabkowich, executive director of the Western Grain Elevator Association said railways have struggled to meet just half the grain industry’s weekly demands despite this year’s crop being 35% smaller than average.?

He added the CP strike would have taken the situation from “terrible to catastrophic.”?

The Surface Transportation Board (STB) is reviewing the CP’s effort to purchase the Kansas City Southern railroad, which would make it the first North American railway to travers Canada, the U.S., and Mexico.

Meantime, as of March 21, 2022, Canadian wheat prices for FOB delivery West Coast were (Cdn$/mt):?

- for the N1 class CWRS 13.5% - $553.96 per tonne, up C$16.22/t from prior week;?

- for the N2 class CWRS 13.0% - $547.01/t, up C$16.32 wow;

- for the N3 CWRS - $574.81/t, up C$2.29 from prior week.

As of March 21, 2022, for the N1 CWAD 13% (durum wheat first class) deferred average prices for delivery in April-May '22 were at C$551.16 unchanged week on week.

Meanwhile, export basis West Coast & Central SK decrease from C$ 209.85 to 198.73 per tonne, as delivered FOB price Great Lakes was posted at C$ 749.89, down C$11.12 from prior week.

Meanwhile, as of March 23, 2022, the durum wheat (CWAD) FOB price for delivery in St. Lawrence, was not quoted.

As of March 25, 2022, for the N1 CWAD 13% (durum wheat first class), average street prices in REGIONAL ZONES were at C$572.42 per tonne, down C$1.12 from prior week.?

(1USD=Cnd$1.2477 down from past week when was 1.2625).

From South America, as of March 24, 2022 - Argentina Wheat Grade 2 export price, (Up River) was at $401, unchanged from prior week.

Argentina corn feed was down $12/t for the week, closing at $329.

Brazilian corn feed (Paranagua) was valued at $363, down $13 from prior week.

Argentina feed barley, was unchanged to $375.

Argentina soybean was down $16 at $679.

Brazilian soybean gained $10 finishing the week at $687.

In Europe, May wheat price on Euronext was up 19.5 euros per tonne from prior week, to close at 381.25 euros.

June corn price was up 14.25 euros for the week, closing at 338.75 euros per ton.

Rapeseed May 2022 contract jumped €31.5/t from prior week, to close €969.25/t.?

May-22 UK feed wheat futures, jumped ￡24 from prior week, closing at ￡316/t.?

Meantime, as of March 24, 2022, FOB prices in US dollar for French wheat with 11.5% protein and April delivery, were at $441/mt, up $7 from prior week.

French durum wheat, FOB Port la Nouvelle continued to be not quote.

French durum wheat - basis La Pallice, was at $450. 84/mt, down $25.99 from prior week.

Spanish durum wheat Sevilla (DepSilo), NA.

Italian durum wheat Bologna (Delivered to first customer), was valued this week at $564.09 per tonne down $4.77 from past week.

German wheat (Depsilo) with 12.5 pro NA.

Baltic wheat (Delivery First) NA.

Corn, delivered Bordeaux port was at $387.06 per tonne, down $29.95/t from past week.

Feed barley FOB Rouen was at 436$/t, up $34.

Malting barley FOB Creil Spot - July 2021 basis was at $461.83 per tonne, up $18.27/t from prior week.

Rapessed FOB Moselle - 2021 harvest was at 1090.80$/ton, up $70.8 compared to prior week.

Standard sunseed FOB Bordeaux - 2021 harvest was up 20.6$ from prior week at $1110.6 per tonne.

(Eur/USD = 1.0996 vs last week 1.1083).

From Africa, Zambia is set to remove a 15% wheat import tariff.?

Zambia typically brings in less than 100k MT of wheat – averaging 49k MT/year over the last 5-years per USDA.

From the Black Sea basin, according to regional agribusiness management bodies, as of March 16, 2022, the average Russian prices for the 3-class wheat were 15.438 rubles/ton (+1.2% within a week).

For the 4-class wheat were 14.800 rubles/ton (+1.1% within a week).

For the 5-class wheat, were 14.153 rubles/ton (+1.2% within a week).

For feed barley at 13.865 rubles/ton (0% within a week).

For food rye – 12.492 rubles/ton (+1.5% within a week).

For corn at 13.824 rubles/ton (+1.2% within a week).

As of March 17, 2022 FOB Novorossiysk prices for the Russian 4-class wheat (protein 12,5%) were at 440 USD/ton (+35 USD/ton within 2 weeks).

Barley was at 425 USD/ton (+115 USD/ton within 2 weeks), corn at 330 USD/ton (+10 USD/ton within 1 week).?

As of March 21, 2022 according to IKAR, although there were few new deals, prices for Russian wheat with 12.5% protein content from the Black Sea ports were at $390 per tonne free on board (FOB).?

In the domestic market, domestic 3rd class wheat European part of Russia, excluded delivery, was valued at 16,150 roubles/t ($154/t) +550 rbls from prior week (Sovecon);

Prices of sunflower seeds were at 39,125 rbls/t +1,100 rbls (Sovecon);

Domestic prices of sunfloweroil were at 98,350 rbls/t +6,675 rbls (Sovecon);

Soybeans were at 47,000 rbls/t +2,100 rbls (Sovecon);

Whitesugar, Russia's south was at $744.3/t +$163 (IKAR).

($1 = 96.0000 roubles)

From South East Asia, Malaysian palm oil futures rebounded on Friday from a selloff in the previous session, amid tight near-term supplies that helped the contract post a weekly gain of about 7%.

The benchmark palm oil contract FCPOc3 for June delivery on the Bursa Malaysia Derivatives Exchange closed 1.48% higher at 6,031 ringgit ($1,433.22) per tonne, recovering from a 4% drop on Thursday.

The contract rose 7.14% this week, regaining some ground after last week's 16% loss, its worst week since 1986.

($1 = 4.2080 ringgit)

In Australia, indicative delivered prices in Australian dollars per tonne were:

Barley Downs: $350 up $10 from March 17;

SFW wheat Downs: $372, up $2 from March 17;

Sorghum Downs: $355, up $13 from March 17;

Barley Melbourne: $380, up $8 from March 17;

ASW wheat Melbourne: $400 up $5 from March 17.

SFW wheat Melbourne: $397 up $9 from March 17.

(AUD/USD=> US$0.7512).

On the international trade scene, Turkish grain board TMO provisionally bought about 175,000 tonnes of corn on Friday in a tender for supplies already at warehouses in Turkey.

The reported purchase was in line with the volume TMO had sought in the tender.

Delivery is sought between April 8 and May 5.

The lowest price paid in Friday's tender was said to be $389.75 a tonne ex-warehouse to the port of Bandirma.

TMO has also issued an international tender to purchase and import a total of 325,000 tonnes of feed corn, with a closing date of March 28.

Watching next week's market, the week has a typical start with the weekly Export Inspections report released on Monday morning.?

Skip ahead to Wednesday EIA will publish their weekly ethanol production and stocks report.?

We will also get the quarterly Hogs & Pigs report on Wednesday afternoon.?

The USDA weekly Export Sales data will be released on Thursday morning.?

Thursday will also see the important NASS quarterly Grain Stocks and Planting Intentions reports.

Trader estimates, show an average trade guess for corn stocks at 7.880 bbu as of March 1st.?

The full range of estimates is between 7.630 bbu and 8.087 bbu.?

Prospective plantings are estimated at 92m acres.

Last year’s corn acres were 93.4m.?

The full range of estimates is between 90m flat and a 100k acre increase.?

As for soybean, the trade is looking to see 1.897 bbu of soybeans were counted on March 1.?

That would be up from 1.562 bbu last season and carries a +/- range of 433 mbu from the high estimate to the lowest estimate.?

As for new crop acreage, also to be released next Thursday, the trade is looking to see between 86 and 92.2m acres of soybeans.?

The average pre-trade estimate is 88.9m acres compared to 87.2m planted in 2021.?

As for wheat, the trade is looking for NASS to show 1.039 bbu of wheat stocks.?

That comes between analysts’ estimating as low as 998 mbu and as high as 1.302 bbu.?

Last year, NASS had 1.311 bbu as of March 1st.?

All wheat acreage is expected to be 47.9m acres, with 34.4m from winter wheat and 11.8m from spring.?

That's all.

To all of you I wish you a good weekend.

Author: Sandro F. Puglisi??

Make love ... not war ...

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